City governments have experienced increasing financial strain over the past several decades – pension payments are coming due, infrastructure needs replacing, and the cost of providing social services is increasing. This leaves little room for local governments to get on the social finance innovation train that has been sweeping the private sector for the past few decades, where bright minds have been exploring social enterprise, low-profit limited liability companies, impact investment, and more. However, many have recognized the importance of bridging the gap between private sector innovation and government, leading to organizations across the sectors investing time and money devising ideas that may fill this void. Continue reading “How the Private Sector is Paying for Public Innovation”
You may have missed the news out of Indiana two weeks ago – no it wasn’t about that – it was the news that Indiana became the first state in the country to launch an economic development initiative focused on Quality of Place. This effort called the Indiana Regional Cities Initiative and now supported by $84 million, is an opportunity for Indiana’s regional communities to rally together to define what they can accomplish to enhance their communities. The visionary leadership of Indiana Governor Pence and Eric Doden, former President of the Indiana Economic Development Corporation, drove the creation of this initiative and it will pay dividends to Indiana’s communities for years to come. Continue reading “Four Ingredients that Led to $84 Million and a Shared Vision for Indiana”
After hundreds of hours speaking with the leaders of America’s transformed cities, analyzing data until our eyes crossed and summarizing all of our findings in an action oriented report, I am ready to provide you with the cliff notes. To summarize, we found that there are nine key themes to consider if you are looking to transform your community.
The news out of California so far in 2014 is raising serious questions about the future of the Golden State.
Strike 1: The most pressing issue is the drought which is widely impacting a state that is home to 1 in 8 Americans. Search California and drought in your favorite browser and you’ll get a long list of articles that should strike fear in all of us and images of what empty reservoirs looks like. Over 17 communities will run out of water in the next 60 to 120 days – 40,000 people left dry. A quick look on the state government homepage Ca.gov seems to disagree with news reports that leaders are taking the issue seriously as not one note on the homepage or the ‘alerts’ tab mentions the situation. In the past year or so climate change or maybe just damn climate has impacted millions (Sandy, AtlantaSnow2014, wildfires and the list grows) yet somehow we are not understanding that these impacts may not be random. And maybe that we should start planning for the worst and celebrating our best. Continue reading “Three Strikes and You’re Out or Still California Dreamin’?”
In recent months our Fourth Economy team has been hard at work on several town-gown development projects. It’s time to share a few lessons learned. First, if you live in a smaller town and are fortunate enough to have an institution of higher education close by, don’t squander the opportunity to build upon this high value asset – embrace it, leverage it, and cultivate it.
While the many positives associated with town-gown partnerships may be obvious to most of us, surprisingly those positives often need to be clearly identified, communicated and tactically acted upon. Continue reading “Small Towns, Great Gowns, Big Opportunities”
Over the past two years, Fourth Economy has provided project management for a number of clients and projects. The common theme for all of these projects is “collaboration.” Economic development is increasingly a collaborative enterprise. Economies don’t fit neatly into our administrative and jurisdictional silos. As a result, economic development requires working with a variety of partners. So it is no surprise that a lot of the work we do as consultants includes organizing and coordinating collaborative partnerships. Continue reading “Four Lessons for Effective Collaboration”
This is not exactly a “Number Behind the News” as we have traditionally used it in this series, but it should be. 2,764 is the number of immigrant investors admitted to the U.S. in 2011. In 2002 that number was 51, so we have seen an incredible increase in these “job creators.” Much of the boost is a result of the EB-5 Immigrant Investor program. Fourth Economy has been very excited by the prospect of this new tool for development and the potential it has to inject both new capital and new energy into regional development activities.
I participated in a forum hosted by West Virginia University President Jim Clements. The topic was on Innovation and American Competitiveness. Fellow participants came from a variety of backgrounds – Provosts, Deans, Students, Alumni which included investment managers, bankers and venture capitalists and more.
The conversation was motivating and really got me thinking more about the work we are doing and how the role we are playing in connecting innovation market participants is so critical.
What really got folks attention was Ray Lane from Kleiner Perkins and an alumni, basically saying that it is time for us to hit the Panic Button. There is so much going wrong right now that small fixes aren’t going to get us out of the economic mess we are in.
Many of us took note of Ray’s observations and the conversation should live on in various forums that we are all participating in. For my part I believe that Ray and other speakers were articulating the values of a fourth economy. Expecting value, showing true leadership and not political stupidity, taking a team approach to economic growth, inclusiveness and respect are all values that we must appreciate in order to move beyond this economic mess.
I pledge to do my part and hope that my friends will join us. Oh and by the way, Ray mentioned the need for a third political party as a way to get our elected leaders back to action and not just rhetoric. Fourth Economy Party anyone?
While we continue to develop this idea, we asked you to provide your confidence level in some broad economic categories. These categories impact areas of the Fourth Economy Index. As you can see from the image above, the overall confidence level in our economic state is less confident, or neutral, than confident in where the economy is heading. There doesn’t appear to be much that we are “very confident” about. Let’s examine how we determined this overall confidence level… Here are the broad categories we asked about… As you can see, the areas of most confidence include the U.S. economy, private sector leadership and innovation investment. The remaining four categories lagged behind greatly, with our educational system having the least amount of backing, considering all neutral attributes. We also asked you to tell us what other economic categories we should measure. The responses were great and included: environmental protection, workforce capacity/ability, collaboration, access to capital, natural resources, U.S. utility patents issued, U.S. technologies licensed, U.S. new high tech products introduced, U.S. R&D investment in technologies, State investments in TBED activities, U.S. manufacturing sales, U.S. exports, U.S. manufacturing jobs created, ROI on federal R&D investment, private funding of tech-based companies, job growth in tech-based sectors, and new ratios such as energy per dollar and productivity in manufacturing sectors. What else should we be measuring to determine the overall state of our Fourth Economy? Use the comments below… Take this month’s poll: Rank the top energy innovations in the last 100 years…
The following article is a post from our guest blogger, Dr. Urmi Ashar, President & CEO of NACD Three Rivers Chapter.
At a recent NACD Three Rivers program titled, “Brave New World: Transformation of Corporate Governance or an Era of Regulatory Reform?” it was concluded that Corporate boards will need to reassess their own role in governance, in light of the transformational changes that are now taking shape. According to Jim Rohr,
“Corporate governance today demands that management’s and board’s neglect of Shareholders, Customers, Employees and Community would be perilous!”
The biggest game changer in the business world has become reputation! Reputation is a mirror on a company’s soul. New communications technologies and social media have created a major exposure for corporations that still function in the old models of PR driven market capture strategy. This fundamental game changer has shifted the power of broadcasting a message to the masses. Added to that are the challenges of society at large that affect the mood of the masses:
- Information overload with unreliable filters
- Scarce resources
- Changing posture, size and diminishing trust in government
- Increasing complexity of Government oversight
- Globalization: U.S. has pursued a path of regulatory isolation while the EU and other markets have adopted globally recognized standards
- Inter connectedness of the world at large makes it impossible to contain risk neatly
Managing reputation with stakeholders has become the number one priority of the business world today. Communicating authenticity and being prepared to be open and transparent when one fails is going to be the only formula for success moving forward.
What do the stakeholders care about today? I think the buzz here is: “Leadership in letting go of the sacred cows”. Fiduciary duties, used to be the cornerstone responsibility of the boards: Duty of care, duty or loyalty and duty of obedience. But today the model of effective Corporate Governance looks as follows (see image on right).
While, leadership and management must go hand in hand, they are not the same thing. The manager administers, focuses on execution of systems and relies on control but a leader innovates, focuses on people and inspires trust.
Board leadership will need to build a reputation that will make itself attractive to creative and conceptual thinkers capable of integrative thinking. Integrative thinkers embrace complexity, tolerate uncertainty, and manage tension in searching for creative solutions to problems. Attracting and retaining the right people on your team is the only secret to success and survival in a rapidly changing complex world.
Thus the focus of board leaders will need to be on communicating the right values transparently to earn a reputation of authenticity in the market place! They need to focus on ensuring they have processes and metrics to measure the right culture that fosters the values they want to project in the market place. This will attract and retain creative talent capable of shaping the future. They will need to be proactive in co-operatively working with economic developers to attract the right talent to the region.
If companies care about attracting the right talent and help a region thrive then they must lead the charge for local economic development in the region in partnership with economic developers. It is the highest form of community service and philanthropy. The road map for the economic developers to achieve this will be to thoroughly scan the environment of the region and ensure there are adequate avenues available in the fabric of the region comprised of the start-up ventures, non-profits and public-private partnerships to encourage the emergence of such talent and the maturation of their leadership. In short the leadership of economic development in this regard cannot be underestimated. The corporate and economic development leadership will need to partner in zealously creating regional systems that are attractive to creative and conceptual thinkers capable of integrative thinking. Integrative thinkers embrace complexity, tolerate uncertainty, and manage tension in searching for creative solutions to problems. They are not simply efficient drones diligent in execution.
The current leadership on corporate and non-profit boards along with the economic development leadership will need to interpret the market demands of today and must create a willingness in their own constituencies to move beyond resisting and “dealing with” change. This is now not simply an ideal on the wish list but a first order need for survival in order to tap the opportunity inherent in connecting with the key constituents in the marketplace.
The most successful organizations and regions will have to focus on attracting and enabling those that are able to invent the future, and are not only able to leverage the strengths and but are also able to effectively manage the weaknesses to realize success. The mindset has to be that of constant awareness and ability to embrace ambiguity and to learn, unlearn and relearn on the fly. The emphasis has to be in creating conditions conducive for survival of intrinsically motivated people whose drivers are: autonomy, mastery, and a sense of purpose.
In order to manage reputation effectively leadership will also have to focus on ability to innovate. Intangible assets will provide private sector in gaining the competitive edge in the fourth economy, which is firmly rooted in technology, supported by innovation and knowledge networks. In order to become sustainable businesses will focus on their own value propositions such that they can adapt to the world’s changing needs and the dynamic seismic shifts in the market place.
Real leadership is less about handwringing and lamenting about an era gone by but more about confronting the realities and constraints of shrinking resources and unleashing the potential of the people it attracts to create an economically vibrant tapestry. This brand of leadership has to emerge simultaneously in the private as well as public sector Today board leadership stretches beyond fiduciary responsibilities to effective management of reputation. It is that fourth duty: The Duty of Imagination, which will attract and empower those that are capable of shaping the future.
About the Guest Blogger: Dr. Urmi Ashar
Dr. Urmi Ashar is the President & CEO of NACD Three Rivers Chapter. She manages Market Cognition, a consulting firm that draws on her multidisciplinary expertise and multicultural sensitivities to help businesses gain competitive advantage. In her organizational work, she uses insights derived from the study of medicine, science, education and business as well as from the experience of bridging two cultures – American and Indian – to build complex, non-conventional solutions to organizational challenges. She currently serves on the board of Excela Health System and serves as the Vice Chair for Nominating and Governance Committee and is on the Strategic Planning Committee for Excela Health.